Market Analysis

Following the I half of most TV channels came to pre-crisis rate of sales of advertising. And in the end of the year, market participants expect that the financial terms of its volume by about 20% will be below last year in grivnevom terms. At the beginning of the year, advertisers save on advertising, and in the II semester, many of them increase their marketing costs, expected in the agency.

In the state of confusion

in 2009 for the Ukrainian market of TV advertising for the first time in the past few years, began in full of uncertainty: advertisers, media agencies and TV channels a few months could not agree on a price for the sale of advertising. Due to a sharp devaluation of hryvnia fall of 2008, advertisers were not able to state budgets for 2009 (usually budgets declared in October and November the previous year).

conjunction with agencies, they insisted on moving in the calculations for the hryvnia, fixed cost of advertising on the average rate in 2008 - 5,05 UAH /$. But it was unprofitable for TV - the percentage of foreign content, the purchase of which is mainly produced for the U.S., they range from 30% to 70%.

As a result, the media earlier this year faced with declining demand for advertising. January was the worst in the last few years - all had been sold 72 thousand WGRP (weighted point rating, number of viewers who saw TV commercials, shown by 30-second equivalent). For comparison: in January 2008 was sold to 110 thousand WGRP, and before that the worst month of sales figures was considered in January 2005 - 80 thousand WGRP.

Among the companies snyavshih advertising with ether, was even the largest advertiser in the country, Procter Gamble and included in the top 10 advertisers, Beeline, the leaders to reduce budgets have also ITT, Unilever and Berlin Chemie. Prior to the pricing of television, advertisers were not able to state budgets and on other media, resulting in the past suffered losses.

The reluctance of advertisers located in the levels of previous years has probably psychological causes. In a crisis, many companies were not ready to invest in their own promotion, - says Director of Sales and Marketing Sales Hausa Good advertising (included in the group Inter ) Dmitry Dutchin.

bear
First

prices this year, appeared only on 19 January. The cost of television, it fell by 40% - the price of the item rating (GRP, the notional unit in the sale of advertising on TV) was $ 420.57 at the rate of 5,05 grn /$.

At the beginning of the year for merchants had two options: to keep prices at a high level last year, and then in the air is limited to the number of companies who buy at higher prices fewer ratings and thus to specify the size of the market, which is unlikely to be able to would be for a short time increase due to new advertisers. Or, to reduce the prices that should have been doubters motivate advertisers to return to TV. The second option has returned the market to fly to the level of sales of previous years , - said Dmitry Dutchin.

At the end of February Sales House also returned to sales on the principle of floating - the cheapest type of accommodation, when the movie is located on the left.

vendor had a positive effect. By the end of May Sales House talked about the necessity of raising the price of TV advertising in connection with the increase in sold out (occupancy ad units). Advertising time was the largest TV channels out of almost 100%, while in January, the highest level of occupancy was only 52%. And in terms of the number purchased by the end of the ratings market semester I went to the level of last year, said director of media Aichi /Carat Alexander Gorokhovskiy.

Now, many companies look at the competitors, how much money they spend on advertising. They are less interested in the absolute level of prices, and more - relative to its competitors - said Dmitry Dutchin .- Advertisers are moving to more expensive types of accommodation, while investing more than its competitors with caution.

in unequal conditions

Restoring the market is uneven. The highest occupancy rate in advertising airtime from the channel, where it involved the largest deployment in the market sellers - Sales houses belonging to the hypothetical group of Inter (among the largest Inter, New Channel, ICTV, STB and NTN). The channel Inter-advertisement in June, completing a nearly 100% - said media director, Initiative Media Andrew Andryushenko .- This was achieved through a variety of tools and pricing more competitive bids, with a combined share of the audience they serve over 60% of channels . According to market participants, Sales House of the Internet at the beginning of the year to offer our customers a so-called discount for the exclusive - the customer receives a discount of 30%, if not advertising on the channels of competitors.

calculation for the future
In financial terms,

TV advertising market in I half behind the same period last year to 25-35% in UAH due to lower prices on advertising, said Mr. Gorokhovskiy. In the second half-year forecasts more optimistic. Even in the summer months, when sales traditionally fall by 30-40% compared to the spring, this year's reduction will not exceed 10-15%, predicts Mr. Dutchin.

In the early years of saving money on advertising, and now they have an opportunity to show them as a profit for the six months, or to send in advance, that will strengthen the market position of companies, - he adds.

increased revenues from advertising to promote and introduce the most flexible system of sales. From 1 July to 40% of advertising time Sales houses are sold on an auction. In June we were in a situation of unmet demand. Now the problem partially solved auction block in which the price of advertising is determined by the demand for it from advertisers, - explains Dmitry Dutchin.

high rate of occupancy broadcast channels of the Inter and the conditional media of Viktor Pinchuk (channels New commercial telegruppy) into the hands of other market players.

In July, some customers will consider the transfer of budgets that do not fit in the channel Inter-advertising on the other channels. fillability there is less, - said Mr. Andryushenko .- Thanks to the transfer of budgets, I think all the major channels in September will be filled by advertising. Therefore, in August Sales House plan to make regular changes to their price lists.

Today, for sellers it is important to adequately assess the demand and avoid the risk of fall to raise prices above the capacity of advertisers, - said Mr. Dutchin.

optimistic assess the situation and researchers. Cortex Company has adjusted the forecast of market development: in April, falling TV advertising market projected at 32% in June - 28%, to 1.7 billion UAH. From 41% to 37% lowered the forecast fall of the entire advertising market on the basis of 2009. In 2010, we forecast growth in the advertising market to 10%, and TV advertising - up to 20%, - says Andrey Kolesnik Cortex .- This will depend on whether the second wave of the crisis, and how to grow the GDP. At the pre-crisis rate of growth of the advertising market could potentially go to the 2012-2013 year. Before the crisis, the average annual growth of the advertising market was 30-50%, recalled Mr. Andryushenko.

Experience shows that after a period of austerity consumer behavior is changing. As soon as the consumer mood change, the market will inevitably start to grow, - he sure.

From the chaos on television advertising market monopolism saved

director Publicis Groupe Ukraine Oleg Popenko:

- Why did early in the year the market has fallen so much?

- were apocalyptic mood: drop backbone of the economy, devaluation of hryvnia jump, and no one could say how deep is the crisis. Some advertisers, such as sellers of home appliances, sales stopped, and the avtotreyderov - fell in several times. And if there is no sales, no money on advertising. Over time, many clients, seeing that things are not as renewed or even increased promotional activity.

- How effective were steps Sales houses?

- Go to the calculations for advertising in hryvna was a right step: at the time no one knew how to lead the national currency against the dollar. It is logical and has been a shift from short to long-term sales contracts. From the market turmoil saved monopolism. If the channels are sold separately, it would be in outdoor advertising: a lot of small players that dumping by reducing the quality of accommodation.

- Can I say that the ads came out of the crisis?

- Stabilization of the demand for advertising and an increase in the number of purchased ratings, in some cases - to the level of last year, began in March. The lion's share of advertisers' TV is a group of FMCG, and consumption in these categories declined slightly. At the same time, crisis-prone categories - cars, household appliances and financial services - in the Ukraine have never been system-for TV.

- What feeds New Commercial telegruppy (NCP) have been completed much faster promotion than others?

- Some channels, such as Inter and Studio 1 1, nedozapolneny and channels NCP - the contrary. Pricing Policy Alliance encourages advertisers to spend money on their channels. The highest rate of Affinity (with an audience channel, the target audience the advertised product .- Ed.) Channels have tubing. Consequently, the share of advertising budgets that go to other channels, for less. But it will not always: it is impossible to hold and prices, and high levels of demand, if the next - is cheaper and without the queue. In the II semester will begin to work smaller advertisers (with a budget of less than 10 million UAH), which uncritically placed on the alliance channel. Their share in total budget has increased from 6% at the beginning of the year to 17% now. Before the crisis, it reached 30%. Many will go to other channels, for example, Ukraine and 1 1, where more space and lower cost. And given that these channels have developed a uniform policy of sales, to cooperate with them will be much easier. Thus, the money disproportionately on channel alliance will continue, but the occupancy level off.

- What will be the annual results?

- In the II semester, we can reach the level of last year. And in general, in 2009 the market will bring together up to 20% less money in grivnevom terms than in the past.

we have learned to maneuver closer to the end of March,

Director of Sales Hausa Internet advertising Oleg Pavlenko:

- For what reason in the early years, there has been a significant drop in the advertising market?

- Many customers took a wait-and-see attitude, watching the developmentof the advertising market and the economy as a whole. Now all the weak spots in the economy have become more evident.

- Why in the beginning of the year, Sales House brought so unusual conditions of placement?

- Private business survive if it is flexible and rational. We have taken steps which, obviously, went to the benefit of both customers and channels. Revenues have begun to level off. Customers received the price in a different way. Some people just bored at the old prices, others vice versa. I remember that in Procter Gamble (PG), for example, very happy. Molo, finally appeared totally transparent, clear system of sales.

- And why PG withdrew advertising budgets with your TV?

- still can not understand. Because then the prices have changed, in fact, we returned to the old pattern of sales. But in the PG it is not taken advantage of. I think that its budget for this year has been quite limited, and the company could not procure the necessary number of ratings to conduct an effective campaign.

- In I half of you came to the amount of taxes last year?

- Already nearly so. In the advertising business is easier to implement some changes, for example, than in manufacturing. We have learned to maneuver closer to the end of March. Many advertisers have realized that life goes on. Companies have begun to adapt to the current instability.

- What changes in the work with agencies occurred this year in connection with the crisis?

- Advertising agencies - as lawyers from the client. They are designed to protect its interests, regardless of whether human or not. In private conversation, representatives of agencies can say that the customer heel and are behind the curve, but they can not do this - we are with him in the same boat.

- Why is the restoration of sales in different channels is uneven?

- The market itself is heterogeneous. Customers in many ways allocate their budgets between TV channels, on the basis of its target audience. In the I quarter, advertisers traditionally tyagotevshie to Inter, freeze the budgets for economic reasons, or find alternative advertising media.

- But your channels recovered faster than others. Market participants explain this policy to provide discounts for exclusive accommodation ...

- I would say that you have incorrect information. Traditionally, advertising on our channels in the 30-40% more expensive than others.

- What will be the size of the market-up to 2009 in financial terms?

- I think in hryvna television sales will equal measure last year.

Irina Mironova

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